Talking about cryptocurrencies a decade ago was something that did not have as much impact worldwide. However, over the years, the global adoption of cryptocurrencies has emerged considerably especially in the last year. According to data from Chainalysis, there has been an 881% increase in crypto adoption, especially in Vietnam and India.
This is the second year that Chainalysis has published its Global Cryptocurrency Adoption Index, which ranks 154 countries based on metrics such as peer-to-peer exchange volume, rather than gross transaction volume. The reason is that this last metric generally favors developed countries with high levels of professional and institutional cryptocurrency buying.
A little more about the global adoption of cryptocurrencies and the Chainalysis study
Chainalysis said the purpose of the index is to capture the adoption of cryptocurrencies by “ordinary people” and “to focus on use cases related to transactions and individual savings, rather than trading and speculation.” The metrics are weighted to incorporate the wealth of the average person and the value of money in general within particular countries.
Most of the top 20 countries are emerging economies, including Togo, Colombia, and Afghanistan. Meanwhile, the United States fell from sixth to eighth place, and China, which cracked down on cryptocurrencies recently, fell from fourth to thirteenth place.
Meanwhile, countries like Kenya, Nigeria, Vietnam, and Venezuela have huge transaction volumes on peer-to-peer (P2P) platforms. Chainalysis reports that many residents use P2P cryptocurrency exchanges as their primary path to cryptocurrency, often because they do not have access to centralized exchanges.
Other influencing factors
The report also says that many residents of these countries turn to cryptocurrencies to preserve their savings in the face of the devaluation of their national currencies. They are also used to send and receive remittances and carry out commercial transactions.
For example, Vietnam is one of the main markets for Bitrefill. This is a company that helps customers make a living from cryptocurrencies by buying gift cards with Bitcoin. “Vietnam stood out to me because it dominated the index,” said Chainalysis research director Kim Grauer, who compiled the report.
Nigeria is a different story, Grauer said. “It has a huge commercial market for cryptocurrencies. More and more trading is taking place on the rails of cryptocurrencies. Including international trade with counterparts in China ”. Many of these countries also have capital controls or a strong migrant and migrant population.
Study blind spots
Although the study is quite good, it is not perfect. Some believe that it may have blind spots, especially when it comes to sanctioned countries. For example, sanctioned nations like Cuba will be underestimated, simply because those cryptocurrency transactions are harder to track.
The truth is that there is no perfect way to measure the adoption of cryptocurrencies globally per capita, but that this index is one of the best available at the moment.